The Harris Poll and Finn Partners have launched the Societal ROI Index, a comprehensive measure of a company’s corporate reputation for social good. In today’s age of consumer activism, the index serves as an invaluable barometer for how well companies are adapting to and even thriving in the current climate. It is a new metric, one designed to reflect the marketplace’s changing expectations around corporate behavior.
The Societal ROI index ranks companies based on three dimensions: Ethical Leadership, Civic Minds, and Visible Values. It is a broad lens that uniquely captures public perceptions of leadership, citizenship and real-world engagement, bringing a holistic assessment to the marketplace. Each dimension has two attributes which are used to create scores and rankings.
“The point of Societal ROI as an index is that it’s not just about whether a company takes a stance or is a good neighbor, we’re dimensionalizing it to represent the broad view the public is taking of corporate behavior today,” said Wendy Salomon, The Harris Poll’s Managing Director of Corporate Reputation. Salomon recently previewed the index and its findings alongside Amy Terpeluk, Finn Partners’ senior partner in the CSR & Social Impact practice, at the 3BL Forum on Brands Taking Stands. “[The public] cares about the ethics of the C-suite and the values they represent; they see companies engaging in complex issues, and so increasingly they have higher expectations. Companies need to understand this and get on board.”
Targeting these complex problems is especially crucial at a time when Americans don’t think companies are doing enough to solve social issues. To inform the creation of the Societal ROI Index, The Harris Poll investigated Americans’ views on companies tackling social issues. A national survey found that 65% of Americans believe data privacy is the number one issue for companies to address, followed by healthcare access (61%), supporting veterans (59%), education (56%) and job creation (56%), but far fewer Americans think companies should be working to make a difference on social issues like LGBTQ rights (30%). Meanwhile only 24% of Americans think companies are making a very positive impact on job creation, the highest number out of all 15 issues listed; the lowest was immigration, just 12% say companies are making a significant impact addressing this issue.
While the numbers appear discouraging, Salomon sees a silver lining. “This is an opportunity for companies who have been quietly and consistently supporting these issues from the get-go. We’re at an inflection point, and it’s never been more important to share information about the good companies do.”
There are clear examples of companies working to make a positive difference in the issues the country faces. The public, however, is apparently unaware of the good work being done. “It’s interesting that the public gives businesses so little credit when many companies are doing so much to be a part of the solution in many of these areas,” Salomon explained.
Through the Societal ROI Index’s comprehensive lens, companies can better understand the strong impact of public perceptions on business outcomes. They can identify points of equity and risk relative to social good in order to help them more strategically invest in their community participation and related efforts.
Having a high Societal ROI score implies that a company is perceived as having a positive and tangible role in society. The higher the score, the more likely the public is to behave in ways the company hopes such as becoming informal brand ambassadors and welcoming expansion into their communities. On the other hand, companies with low Societal ROI scores are seen as having a negative or negligible impact on society, which consequently affects their business.
“In the case of Wegmans who scored the highest, we can delve deeper into the return on their latest social initiative, which involved them joining forces with local law enforcement to combat the rising opioid epidemic with coordinated activities across 82 stores in six states,” said Salomon. “It is possible to look more closely at how they performed on Ethical Stewards, Civic Minds and Visible Values. Societal ROI is proving to be a great diagnostic tool to help companies focus and understand their efforts,” she added.
For this inaugural 2018 Societal ROI Index, Wegmans received the highest score (85/100) and was ranked first. While only select companies were calculated as part of the current index, any company can request its Societal ROI score through The Harris Poll or Finn Partners. Custom research can be efficiently conducted and placed in a broader context in order to contextualize sentiment.